Businesses unhappy with their savings account rate

According to the latest research by Fair Investment Company, a staggering 99 per cent of businesses are unhappy with their savings account rate.

The research comes in the same week Investec revealed that 36 per cent of companies claim it makes more sense to use savings to pay off debts than leave them in low paying deposit accounts.

The research found that between March and August this year, a third of companies withdrew an average of £35,270; Investec blamed the "paltry returns" most businesses are getting on their savings, saying "some have clearly decided to use the money to pay the more expensive interest on their debts."

Julie Smith, head of savings at Fair Investment Company says businesses are getting a raw deal. "Our research shows that virtually all businesses (98.75%) are unhappy with the rate they are currently getting on their savings, while Investec's research suggests that for many, the rates are so bad, they have decided it is not even worth saving."

Rates are poor for everyone at the moment, but for businesses they are even worse. The average personal account is paying 0.79%, but for businesses, the average is 0.48%.

"With one in three business savings accounts paying just 0.1per cent interest, it's no surprise that satisfaction levels amongst business are so low with many realising their money will work better for them servicing debt than sitting in a low paying savings account," said Julie.

She says while there may be nothing we can do to improve rates for businesses, Fair Investment Company can help them find the best rates available through its business savings accounts comparison service.

"We compare leading business savings accounts and can offer up to 4.10% on fixed rates and up to 2.13% on instant access accounts - considerably better than the majority of rates on offer."

The 4.10% rate available through Fair Investment Company is The RBS Royal Deposit Plan 7. This is a three year fixed rate deposit plan that is only available through intermediaries like Fair Investment Company - RBS are not offering a direct deal.

Julie continues, "We believe many businesses are aware that their current savings solution is less than adequate but don't know what to do about it - our business savings accounts comparison service provides them with the much needed tools required to help them make more from their money.

"If your business savings account is receiving low interest - and it probably is - make sure you take a look at the other options out there. Even our best instant access deal is almost six times better than the average."